NEW YORK, June 5, 2017 /PRNewswire/ --
Gold prices rose to a six-week high last Friday, after disappointing U.S. employment numbers raised doubts on the pace of interest rate hikes this year. Spot Gold rose 0.81 percent to $1,276.22 per ounce at 1:06 p.m. EDT on Friday, while gold futures for August delivery was up 0.65 percent to $1,278.30 per ounce. Gold is highly sensitive to the changes in U.S. interest rates as a higher rate will increase the opportunity cost of holding non-yielding bullion. The yellow metal has gained 11.46 percent year-to-date. Golden Dawn Minerals Inc. (OTC: GDMRF), Harmony Gold Mining Co. (NYSE: HMY), McEwen Mining Inc. (NYSE: MUX), Yamana Gold Inc. (NYSE: AUY), Sandstorm Gold Ltd (NYSE: SAND)
The job report last Friday showed that the U.S. job growth and wage growth slowed in May. Investors are concerned that the softer-than-expected labor market could affect the rate hikes schedule this year. According to the Labor Department, nonfarm payrolls increased 138,000 in May. Economists had expected the U.S. to add 185,000 new jobs last month. Average hourly earnings rose 2.5 percent at an annualized pace, also below economists' estimates. The Federal Reserve will hold the policy meeting in the middle of this month. "This is not the kind of report people had hoped for, and that has put pressure on the dollar and yields, and gold is always happy to profit from that," said Georgette Boele, Commodity Strategist at ABN AMRO.
Golden Dawn Minerals Inc. (OTC: GDMRF) also listed on the TSX Venture Exchange under the ticker GOM, announced last Friday that the company has signed a non-binding letter of intent with Advanced Mineral Technology Inc., which owns 100 per cent of the issued and outstanding common shares of BGP Resources Inc. Golden Dawn is acquiring the Lone Star property through the acquisition of BGP Resources, a private Washington State corporation, which holds a 100-per-cent interest in the Lone Star property, subject to a 2.5-per-cent net smelter return royalty.
The Lone Star property is contiguous to the company's Greenwood precious metals project located in the Greenwood mining district, 500 kilometres east of Vancouver, B.C., on Highway No. 3. The company's 100 percent-owned processing facility is 17 kilometres to the north of Lone Star. The 234-hectare Lone Star copper-gold property, composed of a series of patented lode claims and private mineral claims in northern Washington State, lies adjacent to the southern boundary of Golden Dawn's advanced-stage Lexington property. View a map on the company's website.
The geology, both in rock types and structure, as well as the accompanying gold-copper mineralization on the Lexington property, continues south onto the Lone Star property forming a three kilometre long prospective exploration trend of past-producing gold-copper mines and prospects, including the Lexington-Grenoble, Lexington, No. 7 and Lone Star mines. The past-producing Lone Star mine operated over two time periods: from 1897 to 1918, producing 146,540 tonnes, and from 1977 to 1978 by Granby Mining Co., where it trucked over 400,000 tonnes from the Lone Star open pit to its Phoenix mill.
Numerous exploration companies saw additional copper-gold potential on the property, post-Granby. Exploration across the Lone Star property to date includes 252 diamond and percussion drill holes for a total of 23,702 metres of drilling. Most recently, in 2006, Merit Mining Corp. conducted a diamond drilling program adjacent to the Lone Star open pit and interpreted a series of eight shallow to moderately dipping en echelon and overlapping copper-gold zones hosted within a dacitic and minor serpentinite unit, very similar to the Lexington-Grenoble mine. Zones are composed of sheeted and stockwork pyrite-chalcopyrite veins, veinlets and disseminations carrying gold. Many zones in the Lone Star deposit remain open and untested to fully define their extent.
Harmony Gold Mining Co. (NYSE: HMY) through its subsidiaries, is engaged in gold mining and related activities, including exploration, extraction and processing. The Company's segments include South Africa Underground, Surface, and International. On May 9th, the company announced that the annual gold production guidance of 1.05 million ounces is well in reach, with year to date production at 812,000 ounces at a cash operating cost of R439 669/kg (US$996/oz). Harmony recorded an 8% operating free cash flow margin year to date, strengthened by the gold hedging agreements that are in place. The company's underground average recovered grade remains above 5g/t. The all-in sustaining costs (AISC) for the nine months ended 31 March 2017 is US$1170/oz or R516 630/kg.
McEwen Mining Inc. (NYSE: MUX) is a growing gold and silver producer in the Americas. In an interview published on April 17th, the company's CEO, Rob McEwen discussed the gold production in Argentina. "In Argentina, the San Jose mine remains a steady, contributing high-grade silver and gold producer. The country's new government has significantly improved the economic environment for business and mining. Our large copper project, Los Azules, represents a big wild card in our portfolio. If you were to put its copper resource on a gold equivalent basis, it would amount to approximately 40 million ounces of gold," McEwen said.
Yamana Gold Inc. (NYSE: AUY) is a gold producer with gold production, gold development stage properties, exploration properties, and land positions throughout the Americas, including Canada, Brazil, Chile and Argentina. On Friday the company revealed that it has completed the previously announced secondary offering of 26,667,000 common shares of Brio Gold Inc. that it owned, at a price of $3.00 per Brio Share for total gross proceeds to Yamana of C$80,001,000. The Offering was completed through a syndicate of underwriters co-led by Canaccord Genuity Corp., CIBC Capital Markets and National Bank Financial Ltd. and including RBC Dominion Securities Inc., TD Securities Inc., Eight Capital and Raymond James Ltd.
Sandstorm Gold Ltd (NYSE: SAND) is engaged in providing financing to mining companies. The Company focuses on acquiring gold and other metal purchase agreements (Gold Streams or Silver Streams), and royalties from companies that have advanced stage development projects or operating mines. Earlier in April, the company said that Luna Gold Corp. and JDL Gold Corp. have combined their businesses to create Trek Mining Inc. As part of the business combination, a non-brokered private placement financing was completed for gross proceeds of C$83,419,172. Sandstorm holds a 3% to 5% sliding scale net smelter returns royalty on Aurizona and at gold prices less than or equal to $1,500 per ounce, the royalty is a 3% NSR. In addition to the sliding scale royalty on Aurizona, Sandstorm holds a 2% NSR royalty on the greenfields property optioned to AngloGold.
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